The first month of 2020 has proven to be good for at least one macroeconomic indicator – foreign exchange reserves – which jumped up by $559.7 million in January.
The reserves received handsome inflows of $359 million in the closing week surging to a new high of $18.644 million, up from $18.084 billion, according to the data issued by State Bank of Pakistan.
The net foreign reserves held by the central bank surged to reach $12.27 billion. The net foreign reserves held by commercial banks stand at $6.37 billion.
The consistent inflows continued to provide stability to the reserves of the country. A major part of the inflows is being received from the investments made by foreign countries especially from the UK and USA in the government bonds and securities offering attractive profit rates. In addition to investments, loans are part of the inflows from various foreign banks and countries.
The inflows may see further jump when the International Monetary Fund’s (IMF) next tranche is approved in the next few weeks in February 2020.
As a result, Rupee will maintain its strength against Dollar that will also contain import bill and current account deficit of the country.